Mortgage News

3 Things to Avoid Doing as You Apply for a Mortgage

What should you do and not do when trying to qualify for a mortgage loan program?

If you’re interested in qualifying for a mortgage loan program to help afford the cost of your new home, you need to make sure your spending profile is squeaky clean. Many prospective homeowners are unpleasantly surprised at the level of scrutiny their lending agents operate with – everything from credit reports and spending behaviors to employment history and more is up for evaluation. So here are a few insider tips on activities to avoid when you are applying for a mortgage:

Don’t Rock the Boat

This is the biggest piece of advice that prospective applicants should follow when targeting a mortgage. Have you been planning to change jobs? Hold that thought. Maybe you’ve also been meaning to buy a car. But if you have too many spinning plates in the air, loan evaluators might start to doubt your ability to keep current on all payments and responsibilities.

Here are a couple rules of thumb to follow so you don't get any surprises:

1. No Big Credit Moves.

When you are being evaluated by a lending entity, the last thing you want to do is show any kind of unpredictability. Lenders like to see consistency and accountability. This means no opening a new charge account at the department store, and no closing your credit card out. Any action like this can damage your credit score, which could hurt your chances of qualifying for a loan.

2. Curb Your Spending Habits.

In a similar vein, try to monitor your spending habits. Be aware that someone is going to review your transaction history and they won’t want to see big purchases made on a whim. Focus on making consistent purchases and minimizing erratic spending behavior.